FRESH from completing the acquisition of gas utility WA Gas Networks, Canada’s ATCO Group has outlined growth plans for the expansion of its energy infrastructure and power businesses nationally and the establishment of a manufactured accommodation business in Western Australia.
The group has identified a number of opportunities, from the proposed South West gas pipeline running to Albany, to new power stations in the Pilbara and gas pipelines in Queensland.
“It’s like Alberta was 40 or 50 years ago,” ATCO Australia managing director Stephen Landry said.
The group has $1.5 billion in assets and 400 people in Australia, spread across WA Gas Networks (renamed ATCO Gas Australia) and a related IT business, power stations in Karratha, Brisbane and Adelaide, and a manufactured accommodation business.
ATCO Group chief executive Nancy Southern, whose grandfather started the group, said it planned to model the Australian business on the Canadian parent, which has $11 billion in assets.
“We’d like to replicate the model here,” Ms Southern said.
“Until now we have just had the manufacturing business and power generation.
“That’s why ATCO Gas Australia was really attractive to us; it’s a stable utility with growth potential, because it’s such a dynamic region, and lots of opportunities to look at developing lateral pipelines.
“Not big transmission (pipelines) like the DBP (Dampier to Bunbury) but the future of gasifying the state is really quite attractive to us.”
Ms Southern said the gas acquisition also gave the group access to people and skills that would support its broader growth.
“Their previous owners have not really allowed them to demonstrate what a great utility they can be or to pursue the opportunities, and we look forward to drawing on their expertise for our future businesses,” she said.
The growth plan includes strengthening the balance sheet of ATCO Gas Australia; the group paid $321 million in cash and assumed $644 million in debt when it completed the acquisition last month.
This was the group’s first major acquisition in 30 years, and Mr Landry anticipated further acquisition opportunities in the medium term.
“There are lots of highly geared companies in our space in Australia,” Mr Landry said.
“For those companies that can’t make it through tough times, we are prepared to keep our eyes open for opportunities.”
The group has started assessing Premier Colin Barnett’s plan for a gas pipeline to Albany, where ATCO Gas Australia operates the gas distribution system.
“That’s why we think it would be ideal for us to be part of the solution to build a pipeline from Bunbury to Albany,” Mr Landry said.
The group is also targeting power supplies in Port Hedland and the phased development of gas pipelines in central Queensland.
Mr Landry said the group made a small move into WA two years when it bought the Arrow transportable accommodation business, and was currently evaluating locations for an expanded operation.
“We’re going to make another investment, probably prior to the end of December, on a property, to build a state of the art manufacturing facility,” Mr Landry told WA Business News.
The group already has a large manufactured accommodation business in Brisbane and is expanding the Perth operation to service opportunities in the Pilbara.
